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March 17, 2011 / Nate Harris

Only in Texas: Registrant of texaslotterylive.com proves rights or legitimate interest through bad faith use

Summary of Texas Lottery Commission v. CyberIntegration, LLC
(Nat. Arb. Forum Claim No. 1370321)

Filed: January 31, 2011; Decided: March 1, 2011 (Panelists: Hugues G. Richard, Karl V. Fink, and Diane Cabell)

Disputed domain name: <texaslotterylive.com >

texaslotterylive.com

The Parties

Complainant Texas Lottery Commission (“Texas Lottery”) is the official operator of the Texas state-run lottery. Since 1992, it has used the registered marks TEXAS LOTTERY & Design (registered in 1993) and TEXAS LOTTERY (registered in 2003) in connection with the those lottery services, including the website it operates at <txlottery.org>.

Respondent CyberIntegration, LLC (“CyberIntegration”) registered the disputed domain name on July 31, 2006.  It uses the disputed domain name in conjunction with a website that displays results of drawings conducted by Texas Lottery, as well as links and content from competitors of Texas Lottery.

Identical or Confusingly Similar

Texas Lottery has established rights in the mark TEXAS LOTTERY, through its trademark registrations and its continuous use of the marks since 1992. The disputed domain name is composed of Texas Lottery’s mark plus the “generic” term “live.”

Accordingly, Texas Lottery has satisfied the first prong.

Rights or Legitimate Interests

The Panel finds that Texas Lottery has made a prima facie case that CyberIntegration lacks rights and legitimate interests in the disputed domain name. In particular, CyberIntegration’s service of providing lottery results is a bona fide offering of goods and services. “While [Texas Lottery] asserts that it is the only entity authorized to advertise, offer for sale or sell lottery related goods or services in the state of Texas . . ., nothing in the law prohibits anyone from displaying the results of the lottery.”

Though there is “substantial evidence of bad faith use”, the Panel argues that the rights-or-legitimate-interests prong is different than the bad faith prong: “The adjective bona fide was intended, in the opinion of the majority of this Panel, as a descriptor of Respondent’s goods and services, not of Respondent’s state of mind or legal rights. This is why the phrase bona fide is used instead of such adjectives as ‘good faith’ or ‘non-infringing.'” [I think someone needs to brush up on their Latin.] While there may be a viable trademark claim here, “the UDRP was not intended to substitute for a court of law in determining rights between rival competitors.” [Is there any other kind of competitor, really?]

For these reasons, Texas Lottery has not satisfied the second prong.

Bad Faith

Because CyberIntegration is making a bona fide offering of goods or services, “this Panel cannot conclude that the registration of the Domain Name was done in bad faith.” Therefore, the majority of the Panel finds that Texas Lottery has not satisfied the third prong.

Decision

Relief shall be DENIED. It is Ordered that the disputed domain name REMAIN WITH Respondent.

Dissenting Opinion

Panelist Fink dissents from the majority’s finding that CyberIntegration is making a bona fide offering of goods or services. As he graciously points out, “Bona fide means done or made in good faith.” In his view, “bona fide refers to the good faith intent in using the domain name,” and “[k]nowingly using the mark of another in a domain name to market services or products does not constitute a bona fide offering of goods or services.” He cites decisions where rights or legitimate interests were found to be lacking where the respondent offered pay-per-click websites and sites marketing competing products.

Commentary

This decision is kind of a head-scratcher for me. The Panel admits that “there is substantial evidence of bad faith use” by CyberIntegration, but nonetheless finds that that it  has rights or legitimate interests in the domain. This finding is based on the Panel’s reading of Paragraph 4(c)(i) of the Policy as requiring only bona fide goods or services, “not  [a bona fide] state of mind or legal rights.” I’m not sure I even understand what bona fide goods or services are. Will the respondent always win on the second prong, so long as they are not selling illegal fireworks or Cuban cigars? Paragraph 4(c)(i) of the Policy allows a respondent to overcome a prima facie case that it lacks rights or legitimate interests by showing the following:

before any notice to you of the dispute, your use of, or demonstrable preparations to use, the domain name or a name corresponding to the domain name in connection with a bona fide offering of goods or services

The plain language of the Policy requires a bona fide offering of goods or services, i.e., a non-bad-faith offering. The Panel found substantial evidence of bad faith use here. Therefore, CyberIntegration should not have been able to overcome Texas Lottery’s prima facie case that CyberIntegration lacked rights or legitimate interests in the disputed domain name.

The dissenting opinion is absolutely right: [k]nowingly using the mark of another in a domain name to market services or products does not constitute a bona fide offering of goods or services.” Of course, Texas Lottery would still have to prove bad faith registration…

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